August 15, 2011

Try to guess before you look? Here at Meadhouse, we're still laughing at this silly black-and-white drawing. Laughing at. Not with. Use your first idea: What would represent coddling and what would represent the super-rich? Now, put those things together in one image.

227 comments:

why doesn't that corporate raider just send in $10 billion. He has made his $$$ by scooping up small sucessful family business for cheap as they have to liquidate to pay Uncle Sugar at the death of the business founder.

Speaking of coddling the super rich, how much tax does Buffett pay? Does he voluntarily pay more than his team of accountants say he must?

If not, he should shut up.

He has arranged his life to minimize his taxes. As all of us not only can but should.

Pretty much all of his wealth is in Berkshire-Hathaway. B-H pays corporate income tax but as a matter of policy has never no dividends. This means that shareholders, including Buffett, pay no income tax on their share of the profits.

Buffett set it up this way saying that he felt that B-H could better invest the money than individual shareholders.

So he pays tax on his salary from B-H, I think around $200,000/yr. He pays tax on any other monies he receives. He does not pay any personal tax on B-H's considerable earnings.

I have zero problem with this. But he should not complain about others either.

I pay every cent I am legally liable for. I expect Buffett to do the same and assume he does. I do not pay more and do not expect Buffett to do so either.

He does raise the question of why we cap social security. Moreover, why not tax all dividends as income? And require you do FICA and Medicare withholding on it (I believe in 2013, medicare witholding will be done on dividends.)

How can such a successful investor be so innumerate. The average income of the top 1% in 2007 was $1.8M, and the presently pay 28% of federal taxes and have an effective federal tax rate of 30%. This raised $750b. Our deficit is $1600B. To cut the deficit in half by keeping rates for 99% of the people where they are now, you would have to increase the effective federal tax rate on the richest 1% to 60% (this excludes state level taxes). If he just wants to return to 1970's level tax distributions, then we are talking about taking the top rate to almost 40% and increasing tax revenue by a whopping $250B.

This is the left's version of balancing the budget by cutting food stamps and eliminating wastefraudandabuse. Balancing the budget will require painful cuts and large across the board tax increases. The sooner we do so, the more gently we can phase in these changes. The unwillingness of Congress to do so is utterly irresponsible, and jerks like Buffet are their enablers.

I'm profoundly interested in the theory of shared sacrifice. If the rich, super rich and too rich pay more, what do those who are now paying no tax pay as their fair share? Are they deemed to have paid? Constructive taxing?

If not viewed as "a fair share" but simply as "spreading the wealth around" it make perfect, if illegal, sense.

He's heavily invested in financials, like Goldman Sachs, Wells Fargo, and US Bankcorp that were directly bailed out with TARP. His insurance companies were indirectly bailed out when the prices of the stocks and bonds they held were buoyed both by the Federal Reserve's actions to stop the run on money market funds that caused the commercial paper market to freeze as well as the bailout of AIG. Had AIG been allowed to fail, the liquidation of its vast securities portfolio would have depressed the asset prices of all securities.

He should be taxed alot because he profited handsomely from the politicians generosity with taxpayer funds. I say stick it to him in a big way.

Q: Do Bill, Melinda, and Warren get tax breaks for their donations to the foundation?

A. Many individuals enjoy tax benefits as a result of making charitable contributions. The amount of tax savings received depends on both the size of the charitable contributions and the person's annual income.

Bill, Melinda, and Warren have been exceptionally generous in making contributions to the foundation, donating sums much larger than their annual incomes. As a result, the tax savings they receive from these contributions represent a very small percentage of the contributions.

From 1994 to 2006, Bill and Melinda gave the foundation more than $26 billion. Those donations resulted in a tax savings of less than 8.3 percent of the contributions they made over that time.

In 2006, Warren made the first payment on his historic gift to the foundation and claimed no tax benefit from this contribution.

Buffet knows the government could never spend HIS money smarter than HE does, but he's sure that other rich people are not as smart as him and they should have THEIR money spent better by the government.

Is there anyone of any political persuasion that thinks the government can spend their money better than they would themselves?

Is there anyone who doubts that if the government gave the most successful people in the country a chunk of the tax revenue, that those people would make better use of it than the congress and their bureaucrats.

That's called a tax cut. Imagine if all the stimulus money was given to the 1 million most successful people in the country to spend.

Would then result in more jobs or less than the stimulus accomplished?

Buffet doesn't want his taxes raised. He wants the taxes of other rich people raised.

As has been ably pointed out by others here; Buffet can easily pay more if he chooses to. Further evidence of his hypocrisy is that when it comes to donating money, he would rather give it to charitable foundations than the US Government. Buffet has given billions to the Gates foundation, not so much (voluntarily) to Uncle Sam.

Buffet knows, as well as any sane person, that foundations and charities get far more bang for a buck than the feds do.

"In 2006, Warren made the first payment on his historic gift to the foundation and claimed no tax benefit from this contribution."

I doubt that's true. Any tax benefit he does not take advantage of leaves him with less money to donate as he sees fit. If the claim is true, then why wouldn't he just give all the money to the government and let them spend it. Why donate to anyone other than the wise government?

Bland illustration to top an op-ed, but I wonder why his opinion which cuts to the quick when he points out that lower tax rates have only resulted in lower job creation-- upsets so many folks on this blog. As he points out you can be super rich, and pay more in taxes, and that taxes have never kept him or others from investing so what is the problem.

RCocean: the reluctance hereabouts to increase taxes is more about refusing to give more dope [money] to a dope addict [the fed govt]. Why do you favor uncapping FICA and Medicare taxes when they have squandered the 15% we give them now? Will they suddenly adopt good financial habits such as doing a budget once a year?

"In 2006, Warren made the first payment on his historic gift to the foundation and claimed no tax benefit from this contribution."

In that year, perhaps

However, the contribution drastically reduces his future estate tax liability.

He is a hypocrite.

I hope that none of you who are complaining about this make use of the mortgage interest "loophole"

I use ever single tax break that I can, because I resent that while we work our butts off and pay taxes, there are the majority of people out there who are welfare suck ups and get all the benefits without paying any of the freight.

Incorporated, so we can be mini Buffets and take all the write offs and exemptions that we can and pay the least amount of taxes that we can.

To do otherwise is just stupid.

I favor a flat tax with no deductions. A fairly low interest rate but starting at a low income level so everyone has some skin in the game.

I do too. This is what 'broadening the tax base' is all about. EVERYONE needs to pay some income tax. EVERYONE, even if it is just 5% of income.

All are on target, but ricpic & Rialby cap it. Gates, Buffet, et al are ALL about pulling up the draw-bridge behind them. To hell with the people financially trying to get from A to B. "I've got mine, JACK!"

Why on earth is Buffet a hypocrite? Can't he criticize tax policy unless he pays more income tax than he owes?

That's just silly. Althouse was and is a big Walker supporter and apparently supports cuts to the Wisconsin budget. Did she voluntarily cut her own salary and increase her medical and pension contributions before the mandated cuts took place? She whines about having to take a furlough day, but has she refused to take it.

Is there anyone of any political persuasion that thinks the government can spend their money better than they would themselves

You mean you can run your own water treatment plant and build your own roads not to mention maintain an army.

However, the contribution drastically reduces his future estate tax liability.

Huh? Are you really a financial consultant, just resoundingly stupid or patently dishonest? I think it is the latter because you have already claimed you don't know how a progressive income tax works and I don't believe anyone is that stupid.

How does current contributions reduce his estate tax liability? (and of course it is not his, but his heirs' estate tax liability, he will be dead when the estate tax kicks in)

If your answer is that because he will have less money to pass on to his heirs, then that is just a ridiculous argument.

I did not read the article by Warren Buffet because he does not put his money where his mouth is and both are considerable.

What does he do with the excess money that he doesn't know what to do with? He turns it over to the Gates Foundation who does know what to do with it. And that turns out to be Africa where like Oprah they have decided they get a lot more bang for the buck, and not the US government where it disappears, it's effect completely unnoticed.

What a laughable old con-artist Warren is. Got too much money ... give it away. Nobody's compelling you to keep it. Nobody SHOULD compel you to give it away. Nothing prevents you from acting on your principles.

Weary of the retarded arguments from the left that completely miss the point.

The point is made here constantly that there is nothing the government does that couldn't be done more efficiently and better by private parties. This is patently absurd. Fire fighting, national defense, the highway system and air traffic control are all functions that private industry could not do better.

The point is made here constantly that there is nothing the government does that couldn't be done more efficiently and better by private parties.

Wrong. When you use a word like "nothing" you've gone over into absolutism and you know that's not accurate. More true would be "most" while also maintaining that government is trying to do too "much" now, can't afford it, and what it IS doing, it's not doing very well.

If you keep painting with big brushes, you're going to fuck up all that intricate trimwork.

So according to Dust Bunnyism, a Larry Ellison...and/or Hugh Hefner, both of whom never attended college, have a few hundred million and should not pay taxes, because they earned it the old fashioned way, but Educator X--...Schmuckowski--with an advanced degree, knows multivariable calculus, et al makes 50 grand year, if that, and is facing a layoff. The justice of Teabuggerism.

--A better idea for re-distribution--mandatory chess tournaments with the wealthy--when any citizen defeats a Warren Buffett or Ellison or Gates, etc---they got to pay you a few million.

The point is made here constantly that there is nothing the government does that couldn't be done more efficiently and better by private parties. This is patently absurd. Fire fighting, national defense, the highway system and air traffic control are all functions that private industry could not do better

Nice try, flawed argument…. there is nothing the government does that couldn't be done more efficiently versus Fire fighting, national defense, the highway system and air traffic control are all functions that private industry could not do better. You change your terms in mid-argument…a logical no-no…first you argue EFFICIENCY and then you conclude on EFFECTIVENESS.

No one, except Rothbardian Anarcho-Capitalists that non-governmental entities could fight wars both better AND more efficiently. Nor does anyone here, but a Rothbardian argue that anyone but GOVERNMENT SHOULD BE fighting wars. All-in-all a cheap debating point Freder.

I might argue that a private fire fighting company COLD fight fires more efficiently and EFFECTIVELY than its government counter-aprt, using FedEx/UPS versus the USPS as an example. Or suggest that vouchers would be preferable to the Public School system. Canada’s ATC is private, BTW. And the hi-way system wouldn’t be better served as a PRIVATE concern than a public one?

Bottom-Line: bad argument. Wars, being an act of violence that touches upon primal emotions is INHERENTLY a societal/government forte. Most anything else is open to public debate, but you need to keep your terms, efficiency versus effectiveness clear and consistent.

Where did someone say they shouldnt pay taxes? They currently are paying taxes. Paying most of the income tax as a matter of fact. Perhaps you could try a factual argument and say "shouldnt pay even more taxes"

The thing is, he doesn't need to write a check. Just voluntarily retire all of the Treasury bills that you have,and call it a day.Next, shame as many billionaires as you can into doing the same.

The thing is, Buffett makes very little income that is subjected to income tax. His real money comes from investments. If the US decides to discourage investment (particularly from the middle class), we will be far worse off as a nation.

"... You mean you can run your own water treatment plant and build your own roads not to mention maintain an army..."

I think the expectation is the government should be more efficent.

We are spending $1.5 trillion more than we were in 2008 yet leftwing ideolouges like you think reducing spending to those levels will be some kind of economic apocalypse.

I call bullshit. The problem with people like you is there is no such thing as bad government spending and we can't pay enough in taxes. A good chunk of Europe is going down the toilet from following your idiotic economics and all you want to do is bring that misery here.

The Small Pathetic Voice uses a Straw Man…no one argues Hugh should not pay taxes…the argument is that Hugh Heffner should not demand OTHERS pay higher taxes, when all he needs to do is pay more himself. Ditto, Buffett, IF he thinks the “Super-Rich” ought to pay more, all he need do is not give the money to the Gates Foundation and, instead, give it to Obama, to spend.

The point is made here constantly that there is nothing the government does that couldn't be done more efficiently and better by private parties. This is patently absurd. Fire fighting, national defense, the highway system and air traffic control are all functions that private industry could not do better.

@ Freder. That point has not been made as most of the people who suggest that government shrink also recognize that there are legitimate functions of government.

Limited functions such as National Defense and perhaps a national highway/freeway system.

However, all of the other functions you list, which are not necessarily governmental, can easily be outsourced and done in a more efficient and less expensive manner by private industry.

Warren Buffett is also a hypocrite as revealed by his heavy interests in the life insurance market which is the main way that people can reduce their taxes. Estate planning, business planning and personal financial planning.....insurance is the key tool that I used in my practice.

A facebook friend linked to this article. I replied with this link and this link.

So if the ups and down of the top marginal rate don't appreciable affect federal tax revenue and if taxes proportional to taxable income are already disproportionately higher for the wealthy, how do we judge when we've gotten that ideal place where federal revenue is good and tax rates are "fair"?

Ummm...gifting, and charitable trusts are umm.. pretty common tools used in financial planning to reduce estate tax liability, because they...reduce one's estate.

Gifting is one thing, but to argue that using charitable trusts reduces your tax liability is patently ridiculous. Are you really trying to argue that Buffet's children will be better off if he leaves a large part of his estate to charity. Wouldn't they rather have 45% of the money rather than see it all go to charity. Setting fire to piles of cash before you die also reduces your estate tax liability, but it doesn't do your heirs any good.

And of course Buffet frequently states that while he is not going to leave his children destitute, they are not going to inherit the bulk of his fortune. So I don't know what you and DBQ are going on about.

A CRT offers flexibility. It can provide an income stream for life, or a term of years, to the donor and also provide significant tax benefits to the donor and the donor’s heirs. It is called a charitable remainder trust because the charity receives the remainder of the asset after the term.

A CRT is an irrevocable, tax-exempt trust. Assets, like bonds, mutual funds, stocks or real estate, are transferred into the CRT. The assets provide income to the donor for a specific period of time (i.e., the donor’s lifetime or a term not to exceed 20 years). At the donor’s death or term, the remaining assets will be turned over to the charity.

A CRT can offer great tax benefits if the transferred assets have appreciated and would cause large capital gains taxes on the sale of the transferred asset. But, if the transferred assets go to a charity through a CRT, the trustee may be able to sell the asset with no gift, estate, or capital gains tax consequences for the donor. While the income stream from the asset will generate a taxable liability, the donor can take the charitable income tax deduction.

I wonder what it would be like to write on a blog that only one or two folks visited and no one EVER commented on? I bet you come to popular blogs and scream, “I AM…Look at ME!” A whole lot…I bet if you use a pastiche of Splanglish, badly mangled, you get extra, “Look at me” Points. Certainly you’d get some pity and derision, in equal measures.

Again, please note Buffett is talking about INCOME tax and ESTATE TAX, right? His “income” isn’t taxed as income…so higher Income Taxes don’t faze him and he’s giving his Estate away so its moot as to Estate Taxation…so it seems much of this is just silliness and posturing on his part. And it’s funny watching a man whose business is helping clients avoid estate taxes talk about raising them…isn’t he just generating business for himself?

And of course Buffet frequently states that while he is not going to leave his children destitute, they are not going to inherit the bulk of his fortune. So I don't know what you and DBQ are going on about

No, I don’t know what Buffett is going on about…he’s NOT leaving much to his heirs, that’s his right, but he seems to want to FORCE others into his choice, and that’s what bothers me about Buffett. If I’m worth 40-plus billion and I want to leave it to my 19 y.o Sweetie Pie, I ought to be able to…and if I want to give it all to Bill and Melinda Gates, that’s my choice, too.

".. Gifting is one thing, but to argue that using charitable trusts reduces your tax liability is patently ridiculous. Are you really trying to argue that Buffet's children will be better off if he leaves a large part of his estate to charity."

No I'm not. I'm arguing his children and the charity will be better off.

"...Wouldn't they rather have 45% of the money rather than see it all go to charity. Setting fire to piles of cash before you die also reduces your estate tax liability, but it doesn't do your heirs any good..."

Well there you have the leftwing mindset at work. Leaving 45% of your estate to a charity rather than to the Federal government id the same as setting it on fire. Then again I might think that leaving a chunk of my estate to the Red Cross or The Heart Association is a better use of my money than funding another idiotioc welfare program.

"...And of course Buffet frequently states that while he is not going to leave his children destitute, they are not going to inherit the bulk of his fortune..."

And that is his choice as its his money. I personally think the government gets more than enough if my money.

Now, lets talk about lifetime gifts and the tax treatment of the gift tax. The A/B trust structure for marital trusts and the use of life insurance for estate tax reduction.

Why on earth would I want to talk about the gift tax. Gifting is entirely different than charitable giving and trying to make them equivalent is completely dishonest.

As for using charitable contributions to "reduce" your estate tax liability escapes me completely if your goal is to pass the maximum amount of money on to your children. If I give a million dollars my children would be $450 K worse off than if I had just sucked it up and left them the million in my will.

And btw, fire fighting was originally a private enterprise. But you know what happens when you make fire fighting a for profit business? You get a bunch of arsonists.

You also get a bunch of arsonists when you allow people to insure their businesses against fire.

And when you pay firefighters.

Same exact motivation, right?

I will point out there are private fire fighting contracting firms right now. People in Malibu, for example, might pay to have their homes sprayed with fire retardant when there is a brush fire in the area.

Really. You have no understanding of the topic, you're not that bright, and you're making an utter fool of yourself.

Maybe I'm not, so please explain it to me, I am honestly curious. How does giving to charity increase the amount of money my heirs will receive. It certainly reduces the amount of tax owed, but charitable contributions (assuming that the charity is legitimate and not a vehicle designed to funnel money to a particular person) reduce the amount of money I have to spend (because whatever the tax rate is it has never been more than 100%).

One might read the tax-slash meme as Veblenesque--- white trash, small business types in favor of low or no taxes act like they're partying with the Koch bros, though instead of handful of refineries, they run some meth labs or dirt-cheap porno-studio in Marysville or Yuba city, or some shit. Conspicuous consumption, y'all. (thats right DBQ--piss test time)

No, gifting is a way to give money to relatives or friends before you die and therefore have that money deducted from your estate, thus reducing your estate tax liability. With a gift there can be conditions attached to the gift and the beneficiary receives money that he would not receive from the estate because it would otherwise be subject to the estate tax.

When you make a charitable contribution, you are giving money to a third party to do with as they wish. If you gave the money at death, it is still deducted from the estate. So how does giving it before you die lower your estate tax liability? (regardless of the fact that it also reduces the amount of money your children will get)

We can further confuse Freder by discussing gifting to a ILIT (irrevocable life insurance trust) utilizing the Crummy Powers and how it can reduce the gift tax as well as estate tax liability.

Or perhaps a LERP (Life Insurance Retirement Plan) and how to obtain tax free retirement income.

@ Freder.

I don't have the time or space on this comment section to hold a seminar to educate you on estate planning, the tax code system, life insurance, charitable giving etc. If you truly want to know (which I doubt....you just want to argue your talking points) I suggest you start by researching on the WEB (investopedia is pretty basic) or buy a basic book.....written just for you. Estate Planning for Dummies.

Why do you continue to switch the subject to gifting when it is charitable donations.

The question is simple and you should have the time to explain simply.

How does giving money to a charity, either during life or in the will, increase the amount of money you can leave to your children. Of course it lowers your estate tax liability, but giving $1 million to the ASPCA doesn't mean that your children magically get an extra million from the estate. In fact, assuming that I cared more about screwing the government than homeless puppies, my kids are out $450,000 because of my abhorrence of the "death tax" (because I could have left them the million rather than the stupid animals and they would have had to pay $550K taxes on it).

Freder you are hung up on how much the kids get. Estate planning is about being able to have a say where ones wealth goes. Some clear thinking people believe that say, the American Heart Association can put better use to the money than Congress. Yes, I know its a radical concept. Some might think giving money to such a charity rather than the government is like setting it on fire.

The visible facts of Warren Buffet's life make him out to be a fair and honorable person. He's entitled to advance his opinion, and he makes some fair points. I didn't know that it was possible to trade infex futures in such a way as to qualify for long term capital gains.....Contra Warren, I would make the simple observation that for the past two hundred years the great lurches forward for humanity have been made by those who sincerely wanted to get rich and--on a governmental level--by those who sincerely wished to blow their opponents to kingdom come. The tax rates should allow leeway for the full functioning of greed, and it's probably a good thing for the advancement of surgical techniques and prosthetic devices to be in a state of chronic war.

MayBee said...I'm all for a law that says: Everyone who is as wealthy as Warren Buffett must pay a 50% capital gains tax.

8/15/11 11:38 AM

Spot on. Others also made the same point. At Buffet's level all revenues should be taxed at the top income rate irrespective of the source such as municipal bond interests and have no offsetting credits, allowances or deductions going back to dollar one. That will shut that sanctimonious son-of-a-bitch up. And by the way for the chattering classes, tax non-religeous charities and foundations on their investment incomes and charge them a gross receipt tax on the donations they receive. Why should a multi-billion endowment like Harvard's escape taxation? Or the Ford Foundation? Let's call it the hypocrite's put your money where your mouth is tax.

This statement is undoubtedly true, but patently dishonest. In fact, if Buffet wanted to screw the government out of as much money as possible he would hold on to all his money and, in a great last act of defiance, leave it all to a charity in his will. In that way, rather than having his taxable income reduced by the contribution at a tax rate of 17 odd percent (assuming that the vast majority of his income is from Capital gains and not ordinary income), the government would be screwed out of 55% of his money.

I know that DBQ would like to tell me that if someone has a $6 million estate and leaves $1 million to charity there will be no estate tax, but if nothing left to charity the entire estate is subject to the 55% tax ($3.3 million). Too bad for her I have already nailed her for misstating how the progressive income tax, and the estate tax, works, and she knows that this lie will be dismissed out of hand.

All she is left with is trying to switch the subject to gifting and gift taxes, which is an entirely different subject.

I live near the Carnegie mansion, the Fifth Ave one. It wasn't his prime mansion, but it's fairly elaborate. He was the richest person in the world, and there's no denying he lived well, but I always find it comforting to observe how much better I live than Andrew Carnegie. He had organ music piped into every room of the mansion. I have the world's greatest orchestras at my fingertips. He had to have another mansion to avoid the summer heat in the city. I have an air conditioner. He could afford the best doctors. I can afford antibiotics. And not for any amount of money would I go to see his dentist. In terms of nutrition, entertainment, health, and a long list of other things, I live far better than Andrew Carnegie.....At the end, he gave all his money away, but his greatest contribution to civilization was to provide a reliabe product--steel--at a reasonable price and make a ton of money doing that. He gave his money to various Carnegie foundations that have employed any number of wastrel eggheads over the years. Cheap steel has proven to be far more useful.

In other words, billionaires generally make more money via establishing foundations and charitynomics than by paying taxes as ordinary citizens. The Andrew Carnegie school of Fraud, graft, and Embezzlement.

I have spent a boatload of money on tax and estate attorneys and accountants to attempt to accomplish what you stated. I hope the snarky commenters actually read and learn for once. The system is gamed which is why Buffet prattles his nonsense. If one adds up the amount spent on the lawyers, accountants and the insurance policies over the lifetime of the individual dedicated to preserving the estate for their heirs it is usually pretty close to the estate tax itself. Its sort of like paying for a home in cash or over time with a mortgage. For most of the estates subject to inheritance taxes, the estates are big enough to have to pay a chunk of change but not big enough to pay it off in full and have any real remaining value. So you pay it on the installment plan while you are alive and have earnings to use to pay for what is in essence a prepaid tax.

In other words, billionaires generally make more money via establishing foundations and charitynomics than by paying taxes as ordinary citizens. The Andrew Carnegie school of Fraud, graft, and Embezzlement.

Very few billionaires can bench as much as you can, Jolly, so chances are you could beat the shit out of each one of them.

There isn’t anything dishonest about it whatsoever. All she claimed is that the charitable contribution reduces his estate tax liability. If there is dishonesty involved, it’s from you who falsely attributed a motive (getting more money for your kids) behind charitable contributions.

In fact, if Buffet wanted to screw the government out of as much money as possible he would hold on to all his money and, in a great last act of defiance, leave it all to a charity in his will. In that way, rather than having his taxable income reduced by the contribution at a tax rate of 17 odd percent (assuming that the vast majority of his income is from Capital gains and not ordinary income), the government would be screwed out of 55% of his money.

Actually only 35%. But yes, he could probably do that if he wished. Again, not seeing what kind of point you are trying to make.

I know that DBQ would like to tell me that if someone has a $6 million estate and leaves $1 million to charity there will be no estate tax, but if nothing left to charity the entire estate is subject to the 55% tax ($3.3 million). Too bad for her I have already nailed her for misstating how the progressive income tax, and the estate tax, works, and she knows that this lie will be dismissed out of hand.

Um…the current law exempts individual estates of $5 or less from estate tax, and the current max rate is 35%. Also, I believe only the amount over $5 million would be subject to estate tax.

All she is left with is trying to switch the subject to gifting and gift taxes, which is an entirely different subject.

As I mentioned before, estate planning utilizes multiple tools, not just gifting, or just CRTs. Savvy estate planners utilize multiple ways to reduce tax liabilities. This seems to be a difficult concept for you to grasp. DBQ simply pointed out the charity reduced his estate tax liability and you are the one who created the strawman of ‘how does this leave more money to his childrens’. Before you accuse people of dishonesty, at least try being a bit truthful yourself.

Actually there is. If I have $10 million dollars and contribute $1 million to charity, my estate will have a value of $9 million when I die. If I have a $10 million estate and I leave $1 million to a charity in my will, my taxable estate is still $9 million (for simplicity sake I am ignoring all the other deductions available under the estate tax). Whether I made the contribution before my death or in my will does not affect the taxable estate at all.

Freder - what's more dishonest is Democrat politicians promising to soak the rich to give welfare state benefits to the people who vote for them. I don't begrudge wealthy people who use any loophole to evade taxation. To me they're performing their moral duty.

Actually there is. If I have $10 million dollars and contribute $1 million to charity, my estate will have a value of $9 million when I die. If I have a $10 million estate and I leave $1 million to a charity in my will, my taxable estate is still $9 million (for simplicity sake I am ignoring all the other deductions available under the estate tax). Whether I made the contribution before my death or in my will does not affect the taxable estate at all

I believe you’re missing the point, hard to believe…the point being made is that there are ways to reduce your Estate Tax obligation, that may or may not reduce your estate. You convert it from YOUR estate into some OTHER legal entity. Plus the point being made that you can give the Federal 35%-55% of your estate, OR you can find a way to donate that to a charity or eleemosynary organization…whioch do you think will more effectively use the money to: reduce poverty, improve education, make sure that canaries are well-treated, or whatever project or projects YOU feel are worthwhile, as compared to what the FEDERAL GOVERNMENT feels is worthwhile.

And YES. Buffett's children can be better off financially when a good portion of the wealth is transferred to a charitable trust..

That is a stronger claim than simply that Buffett's estate taxes are lowered by this donation. I have not seen an explanation of how this might happen, but perhaps I am just dense.

I can think of two ways this might be the case: (1) The asset being donated is appraised at a value well above its true market value, thereby raising the value of the tax deductions taken by enough to more than offset the true value of the donation. (2) The unstated premise of the argument is that the donor's heirs would have made the same charitable donation that the donor did, but the donor's overall estate is larger because of the tax deductions he took during his life.

Actually there is. If I have $10 million dollars and contribute $1 million to charity, my estate will have a value of $9 million when I die. If I have a $10 million estate and I leave $1 million to a charity in my will, my taxable estate is still $9 million (for simplicity sake I am ignoring all the other deductions available under the estate tax). Whether I made the contribution before my death or in my will does not affect the taxable estate at all.

Wow. Um your will IS your estate which means if you have $10 million in assets and leave $1 million to a charity in your will, that $1 million would be subject to the estate tax because its being paid out from the estate.

Since I am a millionaireandbillionaire I would like to suggest that we continue to coddle the super-rich and discontinue coddling the poor. As we have seen in England, the poor show no gratitude for what they are given and have come to expect to live as well as I do which is preposterous given how much I work and how little they work. Mr. Buffet is a secular man and like secular men he is finding himself very afraid of the death that advances on him daily, hourly. He is hoping here, at the last, to buy a little exemption from what awaits him by arguing forcefully for the diminishment of his wealth by force when he could, as has been pointed out here on this thread, voluntarily contribute every last penny to the Government if he feels like it.

Or, Warren Buffet could take on the task of subsidizing the daily flights from Ely,Nevada which cost the taxpayers of the U.S. about 4,000 per occupied seat. Go for it Warren, the reaper cometh.

And YES. Buffett's children can be better off financially when a good portion of the wealth is transferred to a charitable trust..

That is a stronger claim than simply that Buffett's estate taxes are lowered by this donation. I have not seen an explanation of how this might happen, but perhaps I am just dense

Do you think Ted Kennedy WORKED for his money or any of the Kennedy clan? NO, they have a family trust! That’s what made “Uncle Keg..errr Ted” so annoying when he called for higher INCOME taxes…the bulk of his income came from the TRUST, not his salary…

So YES, you CAN make your children’s lives significantly better, over several generations via a trust or other estate plans.

Lastly, the Gates, nor Buffett are leaving their heirs, much….HOWEVER, If they can appoint their heirs to positions of trust and authority within their FOUNDATIONS, they can certainly ensure a well-provided for future, can’t they? Something you don’t see mentioned amongst all this lauding of their “do-goodism.”

Um your will IS your estate which means if you have $10 million in assets and leave $1 million to a charity in your will, that $1 million would be subject to the estate tax because its being paid out from the estate.

'splain, please. How is ANY income he receives not taxed as income? I don't pretend to know the in's and out's of estate planning as I'm not currently rich. However, I plan to become so on the backs of fiction characters.

Again, the idea that Buffett would be trying to give more to his kids by giving so much to the Gates' Foundation is a red herring. The problem there is that some people (including at least Bill and Melinda Gates, and possibly Buffett) believe that giving too much money to their kids would not be good for them. That is why, apparently, the Gateses are giving their kids only $10 million or so each. Think the Hilton sisters, and any number of other trust fund babies. Indeed, it is quite common for third, etc., generation wealth to be frivolously wasted, with those who inherited such often turning into decadent wastrels.

I go back and forth between whether the Gateses or Paul Allen, have done more with their billions. Two very different approaches. But, in any case, the Gateses have done far better with their giving than most of us have, in terms of its positive effects on the world. They have approached philanthropy extremely intelligently, and the world is a better place for their giving (though I still am not a Windows fan).

But, Buffett reveals himself as a hypocrite by giving his money to the Gates foundation to manage, and then pushes the rest of us to give our money to the government to spend (and, maybe, possibly, invest a just a little bit of it in our future). If our government were all that good at spending money to advance our country, he would do better to have given it to said government, than to Bill and Melinda Gates to manage. But, he didn't.

No, I asked if anyone thinks the likes of Nancy Pelosi, Harry Reid, Obama or the DMV people would spend their hard earned money better than they could.

Maybe you think those people are a lot smarter than you (You should know), but I know they are not smarter than me or most other successful people who pay most of the taxes. Most of these people who you believe are smarter and less corrupt than you, are people who have spent us into unsustainable debt. Now maybe you would do that too, but I wouldn't. Successful people, by definition do not do that.

The left believes it's a smart to take money from the most successful and give it to the least responsible resumes to solve problems as long as they are "clean and articulate".

That's your strategy. Own it. Defend it. Buffet is not, he's just using guilt, as a reason, not sound logic.

'splain, please. How is ANY income he receives not taxed as income? I don't pretend to know the in's and out's of estate planning as I'm not currently rich. However, I plan to become so on the backs of fiction characters

Uncle Keg’s Family Trust, clips it’s stock coupons this quarter and pays Uncle Keg $250,000 taxed , not as income, but as a Capital Gain, IIRC. Simultaneously, the Good People of America give Uncle Keg $250,000 as his salary, taxed at 35% or IF Obama had his way ~40%. Uncle Keg NETS more from the Family Trust coupon clipping, and the Trust Pay-outs may have been larger than his salary…hence Uncle Keg, could afford to have his INCOME taxed at “J”’s 70% rates, as his “income” only included his Senate salary.

If you want to hurt Kennedy’s tax WEALTH or CAPITAL GAINS….then we’ll see how the Progressive Rich/Responsible Wealth types like it…take about 10% of the Family Trust or hit some Responsible Wealth Goober with a 70% Capital Gains tax rate and I’ll bet suddenly they all become TEA Party members.

Had you spent a ‘ute studying USEFUL things, rather than fanciful things, like the Zombie Apocalypse, you’d know these things….or if you were a Jooo, you know we “people” have a “feel” for this sort of thing.